Financial Management And Business Tax

Question 1

Three main types of accounts

Answer 1

1. Current account
2. Deposit account
3. Overdraft

Question 2

Formula for Gross Profit:

Answer 2

Turnover - Direct Costs = Gross Profit

Question 3

Formula for Net Profit:

Answer 3

Gross Profit - Indirect Costs = Net Profit

Question 4

What are short term funds?

Answer 4

Current liabilities.

Question 5

What are short term uses?

Answer 5

Current assets.

Question 6

What are long term funds?

Answer 6

Long term liabilities.

Question 7

What are long term uses?

Answer 7

Fixed assets.

Question 8

How long is long term and short term?

Answer 8

Long term > 12 months
Short term < 12 months

Question 9

Formula for working capital

Answer 9

Current Assets - Current liabilities

Question 10

Formula for Working capital ratio

Answer 10

Current assets \ Current liabilities

Question 11

Formula for Employed Capital

Answer 11

(Fixed Assets + Current Assets) - Current Liabilities

Question 12

Formula for acid test ratio

Answer 12

(Current assets - stock) \ Current liablities

Question 13

How long should VAT related documents be kept?

Answer 13

6 years.

Question 14

Employer national insurance contributions percentage?

Answer 14

13.8% of employee’s wage.